Commercial Investment Real Estate July/August 2019 | Page 10

MARKET
TRENDS
Planning Medical Offices with Consumers in Mind
Medical office buildings need to consider three features for success in the future, says Jon Boley, senior vice president of
acquisitions and development for HSA PrimeCare, a Chicago-based developer and manager of health care facilities. Writing in
Healthcare Business Today, Boley says that these buildings need:
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“360-degree
wellness” in design and
site selection. Wellness
features include fitness
centers, community
spaces for health and
nutrition education, and
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Briefly Noted
Retail: Storefront, a 5-year-old
New York startup, has become
the world’s largest marketplace for
popup stores, or short-term retail
spaces. The company represents
more than 10,000 listings in North
America, Asia, and Europe. CEO and
co-founder Mohamed Haouache
tells Stores magazine that Storefront
works with mall companies and real
estate brokers to keep vacancies
low and “keep older retail spaces
alive.” The average length of a typical
popup store contract, he notes, is
12 to 15 days, and about 60 per-
cent of popup activity is seasonal.
“My vision is to make popups more
accessible,” he says. “I want renting
retail space to be as easy as booking
a room on Airbnb.”
Health/Senior Care: After four
years of decline, occupancy at
skilled nursing facilities in the U.S.
was 82.4 percent in 4Q2018, virtu-
ally unchanged from the previous
quarter and down only 0.4 percent
from the previous year, according
to the National Investment Center
8
July | August 2019
for Seniors Housing & Care. “While
it appears that the worst of declin-
ing occupancy has passed, it’s too
early to predict whether occupancy
will increase over time,” says Bill
Kauffman, senior principal at NIC.
“However, it’s likely that the growth
of elders in their 80s … will boost
demand for skilled nursing care.”
And, he added, “even though we’re
seeing stability in both rural and
urban areas, rural areas face distinct
challenges brought on by lower levels
of occupancy, low reimbursement
rates, and labor concerns. These fac-
tors have contributed to hundreds of
facilities closing in rural areas.”
Office: The rise of driverless cars
will leave its mark on the com-
mercial real estate industry. Matt
Caywood, CEO of TransitScreen,
which provides real-time information
about public and private transporta-
tion to buildings, tells GlobeSt.com
that low-speed driverless vehicles
will be able to provide transportation
to businesses that aren’t adjacent
to transit, which can lead to more
options for a company’s choice of
locations. High-speed vehicles that
serve suburban areas could help
boost the value of real estate farther
from city centers.
Student: Has the “amenities war”
in student housing peaked? Colleges
may be rethinking resort-style living
communities and focusing more
on features that support students,
while maintaining occupancy levels
and increasing value. Bisnow.com
reports that schools are focusing on
improved study spaces and open
areas to promote a sense of com-
munity. While high construction costs
may continue to encourage trophy
or high-rent properties, at least one
developer is aiming at low-cost alter-
natives. “If a recession hits, instead
of paying $1,500 in rent for a trophy
unit right on campus, parents will
start asking their kids to look for an
apartment a few blocks away where
they can pay $1,000,” says Jason
Schwartz of Blue Vista Capital Man-
agement. “If there is a correction,
we will be very well positioned.”
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